Third party contacts by IRS personnel in connection with determining and collecting tax from taxpayers are governed by disclosure regulations as well as by certain notice and reporting requirements.

IRC 6103(k)(6) provides that IRS employees may disclose return information to the extent that such disclosure is necessary in obtaining information, which is not otherwise reasonably available, with respect to the correct determination of tax, liability for tax, or the amount to be collected.

IRC 7602(c) stipulates that IRS personnel may not contact third parties with respect to the determination or collection of the tax liability without providing advance notice to the taxpayer. Section 3417 of RRA 98 further amended IRC 7602(c) to require IRS personnel to maintain a record of such contacts and provide taxpayers with this record upon request.

Section 1206 of the Taxpayer First Act amended IRC Section 7602(c)(1), Notice of Contact of Third Parties and now requires IRS to:

The remaining provisions of IRC Section 7602(c) still require the IRS to:

The authorities for these policies are:

The Director of Collection Policy, SBSE, is responsible for the procedures in this IRM.

Managers of employees who make TPCs are responsible for ensuring their employees comply with TPC guidelines and procedures.

Employees who make TPCs are responsible for following these procedures.

Third Party Contact Coordinators are responsible for fulfilling Coordinator duties.

The Headquarter’s Collection program analyst will partner with the Headquarter’s Exam program analyst to ensure the IRM is consistent for all compliance employees.

Program Reports: When IRS personnel document a TPC as described in this IRM, the information is captured in the Third Party Contact Database. This information is provided to taxpayers upon request.

Program Effectiveness: Each BOD functional unit with TPC-related activities should conduct periodic reviews of the TPC program to ensure that taxpayers are being notified of potential third-party contacts and that third-party contacts are being properly reported. Case reviews and quality reviews may include this topic. The methodology and review cycle will be determined by the BOD functional units.

The third-party database is maintained within IDRS, and it is subject to the same access controls and permissions governing IDRS.

The following table defines acronyms commonly used throughout this IRM section:

In addition to this IRM, there are other relevant IRM sections employees will use, including but not limited to:

Helpful information can be found on websites, including, but not limited to the following:

The IRS adopted the Taxpayer Bill of Rights (TBOR) in June 2014. The Taxpayer Bill of Rights (TBOR) lists rights that already existed in the tax code, putting them in simple language and grouping them into 10 fundamental rights. Employees are responsible for being familiar with and acting in accord with taxpayer rights. See IRC 7803(a)(3), Execution of Duties in Accord with Taxpayer Rights. For additional information about the TBOR, see IRS Taxpayer Bill of Rights and IRM 1.2.1.2.36, Policy Statement 1-236.

In all cases involving third-party contact (TPC) notices provided after August 15, 2019, a notice meeting the requirements of IRC 7602(c)(1) must be provided. Employees may not contact a third party until the 46th day following the date of the notice.

The Letter 3164, Third Party Notice, is issued by Collection and Exam employees to notify taxpayers of potential TPCs. There are over twenty versions of the Letter 3164, available to meet specific functional requirements.

The notice must also include the tax period(s) at issue.

If the taxpayer has not received prior notification and a third-party contact is necessary, employees should do the following:

In situations where an IRS employee attempts to reach a taxpayer by telephone, but instead reaches someone other than the taxpayer:

IRC 7602(c)(3) provides for four situations when the IRS is not required to give the taxpayer advance notice or to include a particular TPC on the list of TPCs provided to the taxpayer. The exceptions are:

Treas. Reg 301.7602-2(f) provides detail on additional exceptions as follows:

If an IRS employee determines that providing the advance notice or a record of a specific contact to a taxpayer may result in a reprisal -- an act of revenge or retaliation -- against any person, the notice requirements of IRC 7602(c) do not apply. For examples, see Treas. Reg. 301.7602-2(f)(3), Reprisal, (Link 26 CFR 301.7602-2(f)(3)).

Make a reprisal determination for all TPCs. Make a determination on a contact-by-contact basis with no blanket determinations for different types of contact.

To protect the provider of the information, make any reprisal situation very apparent in the case history with the facts surrounding the reason for the reprisal determination, and consult with his or her manager, if needed. Information that could disclose the identity of the third party should not be in the case history.

Use all available information when making a reprisal determination.

In some situations, a reprisal determination can be made based on the case history If reprisal is determined based on the case history, the facts surrounding the determination should be documented in the case history and the advance notice or notice of a particular contact is not required.

If the reprisal determination cannot be made based upon the facts already known, during the initial discussion with the third party:

Employees may use Letter 1995, Third Party Contact Letter to Request Information. Letter 1995 contains reprisal language and provides direction to the third party if they fear reprisal.

If a letter is sent to an individual third party, include the first part of the suggested language above and add the following:

Any concern raised by the third party with respect to reprisal will be taken at face value.

If the third party does not indicate a reprisal concern, complete and forward Form 12175 as discussed in IRM 25.27.1.4.

If the third party indicates a reprisal concern, document the case history that a reprisal concern exists and do not complete Form 12175. If a third party indicates a reprisal concern after the submission of Form 12175, see instructions for correcting Form 12175 in IRM 25.27.1.4.1.

Form 12180, Third Party Contact Authorization Form, may be used to document the taxpayer's authorization. Consent must be obtained prior to the contact being made by the IRS employee. Although taxpayers may give oral authorization, the best practice is to complete Form 12180. If oral authorization is accepted, the case documentation must include the date and method used to authorize the contact. The taxpayer can revoke the authorization at any time.

If the taxpayer authorizes contact with a third party, the IRS employee is NOT required to provide the advance notice (if not already provided) or record the contact. If contacts will be made with other third parties and the taxpayer authorization has not been obtained for these contacts, the advance notice must be provided and a record of these contacts must be kept.

The employee must inform the taxpayer that the IRS will not maintain or provide a record of the authorized contacts. For written authorizations, this requirement is met by using Form 12180.

If written authorization is to be obtained, do the following:

If a POA signs on behalf of the taxpayer to authorize contact with a third party, they must be properly authorized. Line 5a, Additional acts authorized, of Form 2848, Power of Attorney and Declaration of Representative, must have "Authorize disclosure to third parties" selected. CFINK doesn’t provide Line 5a information; employees must research CFINK for a "M" code in the "AUTHS" field and secure a copy of Form 2848 from the taxpayer if not previously secured.

The employee making contact with a third party may determine that providing the taxpayer with the advance notice or a record of a specific contact would jeopardize the collection of any tax liability, see Treas. Reg. 301.7602-2(f)(2).

If a jeopardy situation exists, take the following actions:

When the jeopardy situation no longer exists, forward Form 12175 to the TPC Coordinator or input personnel. If additional contacts will be made, verify that the taxpayer was properly notified per IRM 25.27.1.3.1.

IRC 7602(c), Notice of Contact of Third Parties, does not apply to contacts made during an investigation (or inquiry to determine whether to open an investigation) when the investigation (or inquiry) is made with respect to a particular taxpayer being evaluated for criminal prosecution by an IRS employee whose primary duties include either identifying or investigating criminal violations.

Third Party Contacts made by civil employees to develop the criminal investigation referral are TPCs under IRC 7602(c). The taxpayer must receive the appropriate Letter 3164, Third Party Contact, and the TPC must be recorded on Form 12175, Third Party Contact Report Form, unless another exception applies.

IRC 7602(c), Notice of Contact of Third Parties, does not apply to any contact with any office of any local, state, federal or foreign entity unless the contact is concerning the taxpayer’s business with the government office contacted, such as the taxpayer’s contracts with, or employment by the office. IRC 7602(c), does not apply to the following:

IRC 7602(c), Notice of Contact of Third Parties, does not apply when the employee making the contact has good cause to believe providing either the pre-contact notice or the record of the person contacted would identify a confidential informant whose identity would be protected under IRC 6103(h)(4), Disclosure in Judicial and Administrative Tax Proceedings.

IRC 7602(c), Notice of Contact of Third Parties, does not apply to contacts in the course of pending court proceedings.

A non-administrative contact includes a contact made by an IRS employee in the course of a pending court proceeding if the contact relates to a matter and issue being litigated, including, but not limited to, service of a Tax Court subpoena on a third party by an employee. See Treas. Reg. 301.7602-2(f)(7), (Link 26 CFR 301.7602-2(f)(7)), for examples.

If a Form 12175 is submitted and it is later determined that a TPC did not occur, select "void" on the top left portion of the original Form 12175 and send to the TPC Coordinator (TPCC).

If a Form 12175 is submitted and later found to be in error: